News

US Dollar Eases ahead of Jobs Report

USD

The dollar index, which measures the greenback against a basket of major currencies, faltered at a two-week peak of 100.40 and descended to 99.63. The risk sentiment earned a lift from the expected phone call between the US and China top trade negotiators. As a result, investors favored riskier currencies to dollar safety. On the other hand, the soft economic data continued to raise investors' concerns over the US economic activity. The Initial Jobless Claims rose by 3.169 million last week, to top around 33 million since the significant covid19 outbreak. Market participants are looking forward to the April jobs report to be published later today. The EURUSD recovered to $1.0854, the GBPUSD rallied to $1.2408, and the AUDUSD climbed to $0.6547.

Equities

Major US stock index futures extended upside rally supported by tech performance where the Nasdaq was able to turn positive again for the year. Investors are optimistic over the reopening of the economy, and bringing activity back to normal as soon as possible. Stock benchmarks neglected the sluggish jobless claims, which showed that more than 33 million Americans have filed for unemployment during the past seven weeks. Market participants will have more insight into the impact of the coronavirus on the US labor market later today with the April jobs report. The Dow Jones Industrial Average futures rose to 24197, the S&P500 futures rallied to 2921, and Nasdaq futures advanced to 9236.

Metals

Gold prices soared as the dollar tumbled along with US Treasury yields. The short-term bond yields extended declines to price in negative interest rates for the first time. The price of a gold ounce rose to a one-week high of $1722, the price of a silver ounce raced to a three-week high of $15.54, and palladium futures rebounded to $1882.

Oil

Oil prices continued to trade in a tight range near a twenty-day high awaiting fresh fundamental drivers. Market participants are following up carefully on the reopening of the economy, especially in Europe and the United States, but also they are focusing on the time needed for the economic activity to come back to normal again, and lift oil demand levels. The West Texas Intermediate crude June delivery hovered around $24, and Brent blent July delivery held steady near $30.

Major Economic Events

GMT Country Event Expectation Previous

12:30

US

 Average Hourly Earnings (YoY) (YoY) (Apr)

3.3%

3.1%

12:30

US

 Nonfarm Payrolls (Apr)

-21,500

-701

12:30

US

 Unemployment Rate (Apr)

16.1%

4.4%

12:30

CA

 Employment Change (Apr)

-2750.00

-1010.70

12:30

CA

 Unemployment Rate (Apr)

16.0%

7.8%


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